Midwest economic diagnosis: anemia, no recession

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A business index that measures economic activity in the Midwest posted an increase for just the second time in the last six months, according to Creighton University’s Economic Forecasting Group.

The index increased to 52.2 in September, up from 52 in August, with a reading of 50 being growth neutral.

Overall, the monthly survey of supply managers in Iowa, Arkansas, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota found that business confidence was the lowest since February 2009 and that 29 percent of firms anticipate layoffs in the next six months, a sharp increase from December 2010, according to a news release.

Growth among firms tied to agriculture and international markets offset a decline in activity among businesses in other sectors of the economy.

 “Putting it together, I expect the region to continue to expand at an anemic pace with little potential for a recession in this region for the near term,” said Ernie Goss, head of Creighton University’s Economic Forecasting Group.

The index is a mathematical average of indexes for new orders, production or sales, employment, inventories and delivery lead time.

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